MutualFundWire.com
   The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
Friday, February 11, 2011 SEC Smells ETF-Flavored Insider Trading Fundsters interested in the ETF side of the mutual fund world may want to take a look at the Financial Times and keep an eye on the SEC. Kara Scannell reports that, according to unnamed sources, the regulatory agency is looking into the possible use of ETFs as a disguise for insider trading. For example, via "ETF-stripping," an insider trader could buy an ETF of an index that includes a stock they have insider information about, then sell short the other components of the index, without ever directly touching the stock in question. (One could use an index fund, too, but perhaps not always since they trade daily, not throughout the day.) Printed from: MFWire.com/story.asp?s=36025 Copyright 2011, InvestmentWires, Inc. All Rights Reserved |